Japan's machinery orders posted their worst monthly fall on record in May, defying expectations of a bounce and casting doubt on hopes that capital spending was picking up and could drive further economic recovery.
The 19.5 percent month-on-month fall in core orders in May from the previous months, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine months, compared with a median estimate of a 0.7 percent gain in a Reuters poll of economists.
That followed a 9.1 percent fall in April, data compiled by the Cabinet Office showed.
Thursday data directly contradicted the Bank of Japan's key tankan survey earlier this month, which found major Japanese companies plan to increased spending more than expected in the current fiscal year to March 2015.
Analysts have expected capital spending in Japan - long a weak link in the world's third biggest economy - to stay on track for a moderate recovery supported by steady corporate mood and earnings.
Capital spending holds the key to Prime Minister Shinzo Abe's campaign to engineer a revival after nearly two decades of mild deflation and stagnation.
However, the Cabinet Office cut its assessment on machinery orders, saying their rising trend is seen stalling.
Source: Reuters
The 19.5 percent month-on-month fall in core orders in May from the previous months, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine months, compared with a median estimate of a 0.7 percent gain in a Reuters poll of economists.
That followed a 9.1 percent fall in April, data compiled by the Cabinet Office showed.
Thursday data directly contradicted the Bank of Japan's key tankan survey earlier this month, which found major Japanese companies plan to increased spending more than expected in the current fiscal year to March 2015.
Analysts have expected capital spending in Japan - long a weak link in the world's third biggest economy - to stay on track for a moderate recovery supported by steady corporate mood and earnings.
Capital spending holds the key to Prime Minister Shinzo Abe's campaign to engineer a revival after nearly two decades of mild deflation and stagnation.
However, the Cabinet Office cut its assessment on machinery orders, saying their rising trend is seen stalling.
Source: Reuters
